TRAI Wants To Tame OTTs With Licenses & Regulations; Net Neutrality Is At Threat In India

“The Only Thing That Is Constant Is Change -” Heraclitus

Telecom Regulatory Authority of India (TRAI) and Telecom firms in India are so much afraid of “Over the Top (OTTs)” players that they want to tame them with licenses and regulations. It seems that the fear is now not merely of revenues, but of their existence and survival.

Last week, TRAI published a consultation paper on “Regulatory Framework for Over-The-Top (OTT) Services”, where in they have put 20 solid questions infront of the general public, and sought their views on licenses and Net Neutrality.

Incase, you want to know who are OTTs, they are referred to as the ones who deliver of audio, video, and other media over the Internet without the involvement of a multiple-system operator in the control or distribution of the content. [Wiki]

Here is how Internet has been classified according to TRAI. Check OTT communication and OTT media.

Last year, when Telecom firms requested TRAI to include new charges and fees from OTT players, the idea was rejected. But now, it seems that after the expensive spectrum auctions, where telecom players committed billions of dollars, it seems that the ghost of licenses and regulations have come back to haunt us.

Last year we had reported that in case TRAI induces 8% licensing fees, then there can be an overall increase of 30% in Internet traffic.

Why TRAI Is Scared?

In the consultation paper, it is mentioned that in 2013, Skype carried 214 billion minutes of International Calls within their worldwide network. This is almost 40% of the global telecom market, and within this year, Skype will actually overtake the traditional telecom firms in International calls usage.

TRAI said, “With innovations in OTT services, Full-HD voice is slowly becoming a reality for customers all over the world. The call quality of Skype and Google Voice is improving rapidly and, in some markets, nearly matches that of a circuit switched call,”

TRAI, on behalf of telecom firms have said that OTTs are single handedly eating their revenues using their platform, and they want to implement licenses and regulations to milk money from OTTs.

Some other stats shared by TRAI in this paper:

• As on January 2015, WhatsApp had 700 million users, all over the world and 30 billion messages were sent on a daily basis
• In 2011, Blackberry had 50 million users who sent 100 billion+ messages daily
• SMS traffic in India has dropped from 5346 million in 2013 to 4367 million by 2014 end, a drop of 18.3%

TRAI added, “The user base of OTT messaging services has grown to more than one billion in less than five years, impacting TSPs and other service providers all over the world. This impact has also been felt in India.”

On one hand, this is an open acknowledgment of the improvement in technology but also, on the other hand, its an SOS about the future of telecom in India. And the statements aptly reflects their fear.

Glimpse of a Future With Licenses & Regulations for OTTs & Internet Companies?

In case TRAI is able to pull this through, and implement these licenses and regulations on OTT players, then imagine some scenarios:

• You need to check your email while using Google hangout? Buy another plan from your telecom service provider (TSP)
• Your favorite free Chess app wants to add chat facility in their app. They will need to take a license for that feature
• A new cricket app wants to start real time video chat with players. Wait a second.. have they taken the license?
• Want to make a call using Skype on your phone? Buy a new plan with 7 day validity
• Youtube will open superfast on Reliance but Dailymotion will take ages to open as Youtube has paid Reliance some extra money
• and many more such examples….but you get the point

This last example is not mere a fiction but had nearly become a reality when Airtel started offering different plans and tariff for different websites and apps, which is totally against Net Neutrality which states that all Internet services should be provided without any discrimination.

All Internet and Mobile users are informed that they need to send in their replies latest by April 24, 2015 by emailing at [email protected]. The last date for counter comments is May 8^th, 2015.

[box type=”shadow” ]If you do care about the freedom which Internet brings, and if you are concerned about saving the Net Neutrality and Indiscriminate access of tools and services using the web, then do send in your replies of all the 20 questions by mailing TRAI at [email protected].[/box]

Here are the 20 Questions that TRAI is seeking answers for…

1. Is it too early to establish a regulatory framework for OTT services, since internet penetration is still evolving, access speeds are generally low and there is limited coverage of high-speed broadband in the country? Or, should some beginning be made now with a regulatory framework that could be adapted to changes in the future?
2. Should the OTT players offering communication services (voice, messaging and video call services) through applications (resident either in the country or outside) be brought under the licensing regime?
3. Is the growth of OTT impacting the traditional revenue stream of telecom service providers (TSPs)? If so, is the increase in data revenues of the TSPs sufficient to compensate for this impact?
4. Should the OTT players pay for use of the TSPs network over and above data charges paid by consumers? If yes, what pricing options can be adopted? Could such options include prices based on bandwidth consumption? Can prices be used as a means product/service differentiation?
5. Do you agree that imbalances exist in the regulatory environment in the operation of OTT players? If so, what should be the framework to address these issues? How can the prevailing laws and regulations be applied to OTT players (who operate in the virtual world) and compliance enforced? What could be the impact on the economy?
6. How should the security concerns be addressed with regard to OTT players providing communication services? What security conditions such as maintaining data records, logs etc. need to be mandated for such OTT players? And, how can compliance with these conditions be ensured if the applications of such OTT players reside outside the country?
7. How should the OTT players offering app services ensure security, safety and privacy of the consumer? How should they ensure protection of consumer interest?
8. In what manner can the proposals for a regulatory framework for OTTs in India draw from those of European Telecommunications Network Operators (ETNO)? What practices should be proscribed by regulatory fiat?
9. What are your views on net-neutrality in the Indian context?
10. What forms of discrimination or traffic management practices are reasonable and consistent with a pragmatic approach? What should or can be permitted?
11. Should the TSPs be mandated to publish various traffic management techniques used for different OTT applications? Is this a sufficient condition to ensure transparency and a fair regulatory regime?
12. How should a conducive and balanced environment be created such that TSPs are able to invest in network infrastructure and Content and Application Providers (CAPs) are able to innovate and grow? Who should bear the network upgradation costs?
13. Should TSPs be allowed to implement non-price based discrimination of services? If so, under what circumstances are such practices acceptable? What restrictions, if any, need to be placed so that such measures are not abused? What measures should be adopted to ensure transparency to consumers?
14. Is there a justification for allowing differential pricing for data access and OTT communication services? If so, what changes need to be brought about in the present tariff and regulatory framework for telecommunication services in the country?
15. Should OTT communication service players be treated as Bulk User of Telecom Services (BuTS)? How should the framework be structured to prevent any discrimination and protect stakeholder interest?
16. What framework should be adopted to encourage India-specific OTT apps?
17. If the OTT communication service players are to be licensed, should they be categorised as Application Service Providers (ASP) or Communications Service Providers (CSP)? If so, what should be the framework?
18. Is there a need to regulate subscription charges for OTT communication services?
19. What steps should be taken by the Government for regulation of non-communication OTT players?
20. Are there any other issues that have a bearing on the subject discussed?